Stocks closed mixed Thursday as investors combed over the latest round of corporate earnings reports.
While the Dow Jones Industrial Average extended its longest win streak in years thanks to strong results from Johnson & Johnson (JNJ), disappointing reports from Netflix (NFLX) and Tesla (TSLA) sent the Nasdaq Composite tumbling.
Taking a closer look at the numbers, pharmaceutical giant Johnson & Johnson was easily the best Dow stock today, surging 6.1%. The pop came after JNJ beat on its top and bottom lines, reporting second-quarter revenue of $25.5 billion and earnings of $2.80 per share. The company also lifted its full-year forecast.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
On the flip side, Netflix stock fell 8.4% after its quarterly results. While there were lots of positives in the report – a gain of 5.9 million new subscribers thanks to its password-sharing crackdown, an upwardly revised free cash flow forecast due to the dual strikes currently underway by Hollywood actors and writers, and a big profit beat – the company fell short on the top line. Specifically, NFLX reported revenue of $8.2 billion, below both the company forecast and analysts' estimates.
Tesla stock also declined following its Q2 results, ending the day down 9.7%. The electric vehicle (EV) maker reported higher-than-expected earnings of 91 cents per share. Revenue of $24.9 billion also came in above estimates. However, TSLA's gross margins of 18.2% were lower than anticipated, while its operating margin fell to 9.6% from 11.4% in Q1.
On the economic front, initial jobless claims fell by 9,000 last week to a two-month low of 237,000. "Markets are tumbling on fears that reports of a strong labor market alongside weaker earnings will cause the Fed to remain hawkish and push the country into recession in the name of reaching 2% inflation," says José Torres, senior economist at Interactive Brokers.
At the close, the Nasdaq was down 2.1% at 14,063, while the S&P 500 was off 0.7% at 4,534. The Dow, however, finished up 0.5% at 35,225 to mark a ninth straight win, its longest such streak since September 2017.
EV stocks remain poised for growth
Tesla's second-quarter earnings report certainly disappointed investors, but the company's growth in the electric vehicle space cannot be denied. TSLA has seen its annual earnings per share rise to $4.07 in fiscal 2022 from a per-share loss of 9 cents in fiscal 2018, while revenue nearly quadrupled over that same time frame to $81.5 billion. Plus, Tesla delivered over 466,000 vehicles in Q2 2023, nearly doubling deliveries from the year prior.
The industry is expected to see accelerated growth over the next decade, too, as more automakers shift to battery-powered vehicles. S&P Global Mobility, for one, believes that by 2030, one in four new passenger vehicles sold will be electric. This will undoubtedly result in impressive growth for electric vehicle manufacturers and their suppliers.
While artificial intelligence (AI) stocks have been the hot topic around Wall Street in recent months, investors seeking out the best growth stocks would be wise to keep an eye on the electric vehicle space. Here, we take a look at some of the best EV stocks to capitalize on the expanding industry.
Related Content
-
AI Goes To SchoolThe Kiplinger Letter Artificial intelligence is rapidly heading to K-12 classrooms nationwide. Expect tech companies to cash in on the fast-emerging trend.
-
Where to Invest in an Uncertain MarketIn an uncertain market, you can still pocket juicy payouts ranging from 4% to 14%, depending on risk.
-
My Three-Day Rule for Investing: And If it Applies NowStock Market I've seen a lot in my career. Here's what I see now in the stock market.
-
Is It Time to Invest in Europe?Stock Market Europe is being shaken out of its lethargy, militarily and otherwise, by Donald Trump's changes in U.S. policy. Should investors start buying?
-
Stock Market Today: Investors Weigh Weekend NegotiationsInvestors, traders and speculators will look to Switzerland for answers about the most compelling issue confronting global markets.
-
The Best Health Care Stocks to BuyThe best health care stocks offer investors a defensive hedge in an uncertain market. Here's how to find them.
-
Stock Market Today: S&P 500, Dow Snap Win StreaksBerkshire Hathaway shares tumbled after Warren Buffett said he'll step down as CEO of the holding company at the end of the year.
-
Stock Market Today: Great Power Affairs Mesmerize MarketsThe U.S. and China are at least talking about talking about tariffs, and investors, traders and speculators are showing a little less fear.
-
Stock Market Today: Trump Retreats, Markets RejoiceStocks rally, yields soften, the dollar rises, and even beaten-down names enjoy the wages of potential trade peace.
-
Tesla Stock Pops as Elon Musk Promises DOGE Draw BackTesla reported a sharp drop in first-quarter earnings and sales, as the EV maker suffered a backlash to its CEO's political ambitions.
